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11.26.14 – (LAA/LUS) Arbitration Proposal, Mediation Update, LAA Dental Insurance Disparity Resolved, Q&As

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JCBA Hotline Update – Arbitration Proposal, Mediation Update, LAA Dental Insurance Disparity Resolved, Q&As

November 26, 2014

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The APFA leadership has heard from many members over the past several months and it is clear that Flight Attendants are as passionate about our profession as ever. The Flight Attendants on the APFA Board of Directors share this passion. We also take seriously our responsibility to protect our members’ livelihoods. We will never stop fighting to make sure that our members are the best compensated in the industry.

With the membership’s rejection of the T/A, the next step in the process is binding arbitration.  As we all know, under the parameters set out in the NPA, the arbitrators are charged with creating a contract that has a value that is market based in the aggregate. That value will be $112 million annually; $81 million a year less than the value of the T/A. Deciding how to remove $81 million in value from the T/A was a gut-wrenching task. No one wanted to see it happen and no one wanted to do it. Although the arbitration parameters are set, and the contract the arbitrators form must fall within those parameters, the APFA leadership will never stop banging on management’s door for more for this workgroup. We are not giving up. We will never give up.

Linked here is a copy of the proposal the Joint Negotiating Committee (JNC) has posted in advance of the arbitration set to begin next Wednesday, December 3rd. This proposal was drafted after lengthy discussions with the APFA Board of Directors. The JNC is prepared to achieve the best arbitration award possible under the terms of the Negotiations Protocol Agreement. The team believes that “market-based in the aggregate” constitutes $112 million in annual improvements over the current combined contacts.

$112 million per year is the sum of two distinct pots of money:
•   $62 million per year is the amount that is required to reach “market-based in the aggregate” in terms of wages, benefits, and work rules at Delta United and Continental. The proposal reflects recent changes to the market-based standard, which is the result of improvements to Delta’s Terms of Employment since the T/A was reached.
•   The proposal also includes $50 million in annual added contract value in lieu of profit sharing together with a ‘Me Too’ provision in the event that another work group secures a profit sharing program.

The Flight Attendants at the new American have worked very hard and waited a long time to see improvements to our wages and work rules. The JNC’s goal is to convince the arbitration panel to award an Agreement that contains $112 million in annual improvements as close to the end of this year as possible.

Mediation Update
As was reported last week, the National Mediation Board facilitated mediation between the company and APFA. Unfortunately, the meetings were not fruitful. APFA asked for the following four items, and all were rejected:
1. Postpone arbitration and continue to negotiate.
2. Postpone arbitration and let the pilots’ arbitration take place before ours.
3. Agree to a new arbitration standard, making the ceiling the same value as the T/A.
4. Put the arbitrated agreement and the T/A up for a membership vote once the arbitration is completed.

Dental Insurance Disparity Resolved

For several months, the Joint Negotiating Committee has been working with the company to address the disparity in the dental insurance options between the LAA Flight Attendants’ and management’s dental plans. After much discussion, management has agreed to offer LAA Flight Attendants a third option for dental insurance for 2015 at a very low cost. This option brings with it an annual maximum benefit of $1,500 (as opposed to the current plans’ annual max of $1,000).

Because of this new plan offering, the company will be opening up an enrollment window for Flight Attendants some time in December. If selected, this benefit will go into effect beginning January 1, 2015. Please stay tuned to this hotline for further information.

Q & A’s
Q: Why is the market-based value in the proposal $112 million instead of $111 million?
A: On November 6, Delta Airlines announced improvements to their Flight Attendant compensation package that increased the value of their Terms of Employment and caused a $1 million annual increase in the market-based contract valuation.

These improvements include:
•   1-hour increase to recurrent training pay and credit*
•   $10 daily increase to per diem during training (from $25 day to $35 day)
•   50-cent an hour increase to domestic flight leader pay (from $2.70 to $3.20)
•   25-cent increase to hourly purser premium pay (from $5.40 to $5.65 per hour
*The improvements to training pay and per diem are scheduled to go into effect on January 1, 2015, while the premium pay increases are slated for April 1, 2015.

Q: Why were the cuts taken from wages alone in the arbitration proposal?
A: The reason the cuts were taken off of wages alone is because that was the only way to achieve parity in the joint contract between both legacy Flight Attendant groups. Any other cut (health care, 401(k), premium pay, sick or vacation) would have created an imbalance in the resulting joint contract.

Also, the Negotiations Protocol Agreement (NPA) addresses the prospect of incorporating value back into the joint contract in the event that United/Continental reaches a deal that positively affects the market-based in the aggregate rate.

The wage table in the APFA’s arbitration proposal was based on the following three criteria:
1) Meeting the $112 million average annual increase to the combined LAA/LUS contracts’ value.
2) Fixing the Step 6 rates to ensure that DOS rates are above current LAA/LUS rates.
3) Maintaining out-year pay increases achieved in the T/A.

The methodology used to determine the rates was as follows:
1) Pay steps 1-12 are based on a split between T/A pay rates and current pay rates. They are the better of LAA/LUS current pay per step (except for Step 6).
2) Top of scale 13-year wage rate is based on the highest amount achievable to meet $112 million average annual increase in total contract value.  
3) Goal of being above current pay rates (better of LAA and LUS at each pay step).

Q: Did you get my email about the NPA?
A: Members of the Board have received emails requesting that the NPA be set aside. That is not an option, and here’s why: The NPA, particularly the arbitration clause, is a direct result of the Conditional Labor Agreement. Without the CLA and the NPA, LAA Flight Attendants would revert back to the LBFO, which contained diminished rates of pay, less sick and vacation, no furlough protection and a reduced 401(k) contribution, among other concessions. The LBFO was a bankruptcy contract, and would not have been amendable until August of 2018. The difference between this merger and United/Continental is the NPA. Without the NPA, management is not required to negotiate now for a joint contract. It can bargain as little or as much as it wants. Only after the LUS and LAA CBAs become amendable (2018 and 2019) and Section 6 of the Railway Labor Act kicks in, is the company legally compelled to negotiate. The NPA/CLA are legal and binding documents.

Please stay tuned to this hotline for accurate information, including updates throughout the arbitration process.

From the APFA Leadership to all Flight Attendants at the new American, we wish you a healthy and happy Thanksgiving Holiday.
AmericanAirlines US Airways 
“On Our Way”

Leslie Mayo
APFA National Communications Chair

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